Whereas you hear from everywhere that IT rocks, digitalization drives the businesses out, and AI is “watching” you, we are the one to show doubt in general prejudices and shed light on the real state of things.

For more than five years HRForecast has been working on the question of how HR should transform, develop and position itself; we have analyzed the most various data from different areas and have formed an impressive voluminous data base. We possess an extensive data pool with 1,5 billion data insights, including 1,3 billion global jobs crawled per week on 900+ job portals, 100.000+ skills in the dynamic market-driven skill catalog, 30 million company profiles, 15.000+ data from universities, and altogether in 116 countries!

Recently, involving the leading HR specialists, we have conducted a GetAway session in order to discuss the topic of the Future of HR from different angles of view. At the very outset we raised two questions — what is necessary to drive the change and is HR ready to drive the transformation?

We all admit the undeniable truth, that Artificial Intelligence or Big Data technologies together with their potentials and risks influence both our privacy and business. Furthermore, HR is not an exception, but a vital part of all transformation processes going on.

Firstly, HR drives the digitization forward (and vice versa) by implementing new technologies in its central issues — recruiting, onboarding, talent management, career planning, and complementing them by chat-bots, workforce analytics, or real-time digital learning platforms. The main focus hence is done on the strategic and innovative human side, while manual and repetitive work can be automated by ever new technologies.

Secondly, HR oversees a smooth integration of a New Work concept into a working world, which is characterized by open collaboration, knowledge sharing, individual upskilling and freedom of decision. As a result of extremely growing technologization and changing working outlooks, HR oversees undertaking a mission to become a mediator between humans and machines.

Everything is moving — except for HR?

In the cooperation with ESCP Business School, we have decided to think outside the box of our customer projects and take another step. Hence, in order to understand the current state of HR we analyzed HR departments globally in the world.

Clustering nine focus countries we analyzed more than 120,000
job postings across various seniority levels, and that’s with one goal: to examine whether HR has adapted to a changing business milieu.

Future readiness score

As we see, only three countries slightly passed the 30% mark. As IT skills are increasingly required in Dutch HR tenders, the Netherlands with the rate of 32% rank first in terms of future orientation in HR and are leading the country significantly ahead. The second place take the US, which are followed by rapidly developing Canada.

The first surprising observation is Germany being ranked almost the last in the “future readiness score”. This does not align with the necessity to invest in emerging technologies to develop an effective digital strategy. But nevertheless, advanced digital skills are a core prerequisite for optimizing and connecting business processes, forecasting skill shortages, building an effective data architecture, and integrating robotics into the workflows.

Our data indicate that HR departments in Germany may lack behind the expectations and do not seem to be properly prepared for the upcoming challenges. This is even more striking as the demand for new digital skills is increasing in many other countries. Nevertheless, and very surprisingly, HR departments in Germany do not seem to follow this trend.

The second Germany-based surprising result (after being second-to-last in the “Future readiness list”) is a drastic decline by 4 percent points between 2017 and 2018 in demand for IT skills in Germany . Despite the understanding, that IT skills are essential for optimizing business processes, predicting skill shortages, and building effective data architecture, Germany strongly lacks the main IT investments and digital technologies.

Skill demand growth of different skill clusters

(only Germany, 2017-2018)

One of the possible REASONS for this divergence is that companies operating in Germany may have anticipated the technological advancement in HR quickly and reacted sufficiently in previous years not covered by the data. The other more likely explanation is that many HR departments in Germany merely have not yet realized the potentials of big data, predictive analytics, and AI and may mostly perform administrative tasks rather than progressing as strategic business partners providing data-based decision-making.

This is a striking result since the demand for IT skills is increasing in many other countries. Considering all nine target countries, we obviously see the rising demand for HR domain skills (such as recruitment, payroll, onboarding, or training and development) and gaining importance for IT skills (especially Human Resource Information Systems-, social media- and data analytics).